The gamesmanship of Congress is still reverberating through the world’s financial system with a big drop in stock markets today. But that may be only the start of the problems caused by the self-inflicted calamity. At risk is the source of the USofA’s real power around the globe – not the military, but the US Dollar itself.
The high standard of living enjoyed in the US is based on the fact that our currency is the standard “reserve currency” across the globe. All commodities and many long-term contracts are priced in US Dollars. If, or more likely when, that comes to a screeching halt the implications are vast for our economy and just about everything we do. Where it gets interesting is that, done well, it could be a liberating experience.